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How to Buy a Car for the First Time in Brantford

How to Buy a Car for the First Time in Brantford

If you're about to buy a car for the first time, you may feel a little apprehensive about the steps that are involved.

 

Our Brantford car loans team are going to provide you with an overview of everything, so you will have complete peace of mind.

 

The first question that you should spend time on is whether you want to buy a new or previously owned car. There is no right or wrong answer, but it comes down to what you are comfortable with.

 

What is your maximum car-buying budget?

 

This is a step that people over look when they buy a car for the first time. Without a budget in mind, the odds of you overspending will dramatically increase.

 

The average car loan in Brantford is in the range of $500 per month, so you could use that as your benchmark.

 

Take a look at your finances and determine whether you can afford $500 per month plus the running costs that come with owning a vehicle.

 

How strong is your credit?

 

The first thing that lenders will look at is your credit score; they will pull reports from TransUnion and Equifax. You need to find out your score from each of these agencies to make sure there are no issues.

 

At the time of writing this, a good credit score in Canada is ~650, so if you are over that score, then you are in great shape.

 

Do you have a reliable income?

 

After reviewing your credit, prospective lenders are going to want to know more about your income sources and whether it is sufficient.

 

The pandemic has caused a tremendous amount of income instability for many Canadians. If you are self-employed, you would need to provide the lender with copies of your bank account statements for the last 12-24 months.

 

This information helps prove your income, and the lender can use it to calculate your average monthly income.

 

Lenders will not approve a loan if your total debt-to-income ratio is over thirty-five percent (35%), so if your income was $10,000 per month, then your maximum debts, including the new car loan, cannot exceed $3,500.

 

If your credit score is very high, then you may be able to go up to 40% but to be safe, stick with the 35%.

 

Sources of amazing car loans in Brantford

 

You will see websites that offer car loans, and they will claim to have great deals. While the rates you find online may sound competitive, you can find better deals by going through a local dealership. These dealerships have very strong relationships with lenders and can get you the most competitive terms.

 

Not only is the dealership able to get you a good loan, but they can also show you how to raise your credit score so you can get the lowest interest rates possible.

 

With the limited number of cars in the market, you should contact your dealership today and find out what options are available. The sooner you do take action, the faster you can realize your dream of buying a new car.

 

We’d love to help you find the perfect car loan. Simply fill in the form below and we’ll get back to you ASAP! 

 

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